teddy
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Post by teddy on May 8, 2017 18:33:15 GMT
Between 5th-8th May, I've noticed 4 sale of loan entries for loan #458 on my GBBA statement.
Can anyone tell me what these are for? I'm not aware that I can sell specific loans within the GBBA, and I've not withdrawn any money from my GBBA account recently.
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pikestaff
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Post by pikestaff on May 9, 2017 5:07:50 GMT
I'm not currently in the GBBA, but have there been purchases as well? If so, it might have been rebalancing.
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happy
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Post by happy on May 9, 2017 6:17:03 GMT
This is due to a feature of the GBBA automated buy/sell algorithm being affected by tranche draw-down loans. If as a result of the draw-down the loan to gross development value at that time rises above the GBBA maximum (currently 71% I think) then the GBBA will sell holdings. This is the case for 458, started at 50%, 2nd tranche in April put it to 73%
Edit:LGDV should drop again as development progresses and the loan would then become GBBA eliable again
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teddy
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Post by teddy on May 9, 2017 8:59:27 GMT
Thanks. . . .I think!  Is there an emote for "that explanation went over my head"? |
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mikes1531
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Post by mikes1531 on May 11, 2017 2:25:49 GMT
LGDV should drop again as development progresses and the loan would then become GBBA eliable again : Presuming LGDV means Loan to Gross Development Value, I don't see why it should drop as the development progresses. The GDV is the expected end value, and AIUI that shouldn't change as the project proceeds.
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happy
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Post by happy on May 11, 2017 5:52:29 GMT
LGDV should drop again as development progresses and the loan would then become GBBA eliable again : Presuming LGDV means Loan to Gross Development Value, I don't see why it should drop as the development progresses. The GDV is the expected end value, and AIUI that shouldn't change as the project proceeds. You are of course correct in theory @mike1531 however it seems thar AC use the LGDV display on the loan page to reflect the current LDV. In the case of this loan, a land development yeilding serviced development plots, the GDV of the site is £1.2m, the loan facility max £730k but the undeveloped site value is £1m (the current state of the project) Current LGDV displayed on the loan page is 73% reflecting the loan to current (ie undeveloped site) value not the final LGDV of 60.83% once the site is deleloped. I have had the same thing happen on another loan (#379) below is ACs response to my question to them: As this loan is for a development project the Loan to Value (LTV) ratio will fluctuate during the development process as works are carried out and funds are advanced to the borrower in stages. This loan met the LTV requirements of the GBBA mandate at drawdown but part way through the development works the LTV ceased to meet the mandate requirements. Because of this loan parts held in the GBBA were sold by the account. It is potentially possible that the loan could qualify again in the future but we cannot guarantee this, if it does then some of its loan parts will be available to be bought by the GBBA. The loan remains available via the Manual Loan Investment Account.As this loan is for a development project the Loan to Value (LTV) ratio will fluctuate during the development process as works are carried out and funds are advanced to the borrower in stages. This loan met the LTV requirements of the GBBA mandate at drawdown but part way through the development works the LTV ceased to meet the mandate requirements. Because of this loan parts held in the GBBA were sold by the account. It is potentially possible that the loan could qualify again in the future but we cannot guarantee this, if it does then some of its loan parts will be available to be bought by the GBBA. The loan remains available via the Manual Loan Investment Account.
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